7 Benefits of Cryptocurrency and Blockchain Technology
Cryptocurrency and the technology it is based on, blockchain, have been the dominant terms ever since digital currencies first saw the life of day more than a decade ago. No matter if you are associated with this business, you have probably heard about the impact of cryptocurrencies and how blockchain technology has changed the industry by allowing them to be decentralized and transparent.
However, more word is needed on all the different benefits of both cryptocurrencies and blockchain technology. Therefore, in this article, we will talk about them in-depth. In case you wish to learn more about it all after reading the article, make sure to visit cryptocreed.com.
Cryptocurrency and Blockchain Connection
Blockchain technology is essentially a database, also called a ledger or all the transactions on a certain computer network. The transactions of cryptocurrencies are shown as smart digital contracts that require details previously agreed upon. These details include the senders, the receivers, the amounts, and the type of digital currency. All of the new transactions are processed in blocks when they are requested and recorded in the aforementioned ledger. This allows anyone in the world to view the transactions making the users trust cryptocurrencies and blockchain much more than banks and traditional, fiat currencies.
The code that powers the blockchain is open-source and free, which means any developer can use it to build a decentralized application. For business, this is a huge benefit because they can upgrade existing apps with specific solutions for various types of businesses. Satoshi Nakamoto is the inventor of blockchain, and he first introduced it when Bitcoin launched back in 2008. As you can see, there is no cryptocurrency without blockchain and vice versa. For the past twelve years, they have expanded together and became a full-fledged industry on their own. In the modern world, digital currencies, or their tokens to be more specific, are the food that blockchain systems and apps need to survive and the benefits of it all are many.
1. Low Transaction Fees
Since cryptocurrency transfers are exclusively done through the peer-to-peer method over decentralized intermediaries, the costs of these transactions are minimal and almost non-existent. Traditional banks include fees on all conversions and transfers, especially when they are international. With digital currencies, there are no such fees, or they are very low.
2. Instant Payment
On top of constantly increasing costs of transfer and conversion, regular centralized authorities like governments and banks, as well as some third parties have unbearable waiting times when payment is concerned. Cryptocurrency does not, as it is all about efficiency because the whole idea is about enabling instant peer-to-peer transactions no matter where the two parties are located.
Speaking of far corners of the world, although we live in a society dominated by IT that has never been more connected, long-distance transactions are sometimes impossible or make no sense because of the geographic and political borders and obstacles. Therefore, it is always a burden when one has to do business with their foreign business partners. One of the biggest benefits of cryptocurrency is its decentralization that allows equal financial infrastructure to anyone, no matter in which country or area they live and how far from their business associates. Anyone can access the market from anywhere, without any worry that a central authority will interfere. All you need is internet access and all of the cryptocurrency and blockchain doors will open for you.
Blockchain Technology Benefits
There has been some mention of this already in the article, but now it is time to delve deeper into the matter. The fact that there is no central authority over digital currencies and blockchain is their biggest benefit and the reason why so many investors and regular people have noticed this new trend. All of the decisions that are to be made are in the hands of the individuals doing the business, and not the centralized authorities and institutions overlooking the moves and taking their cut. This is why governments of some conservative countries have flat out banned cryptocurrencies and their integration in traditional business, which made their citizens are unhappy.
As you know, the whole financial system of the world is largely dominated by centralized powers that both the business and individual people rely on with all of their transaction needs. If one needs safe and authentic money transfers of any kind, they go to a bank. Despite these seemingly great services of the banks we know and trust, such a way of doing things is prone to exploitation and mistrust. The practices and rules of banks change over time in order to tend to the bank owners’ and governments’ needs. They are afraid of digital currencies and their immutable nature because they know that the ledger behind it eliminates all internal actors from manipulating it to their benefit. This is something most of them doo behind the curtain, and despite the people being quite aware of the misuse of power and positions, nobody can really do anything but move to cryptocurrency and blockchain.
Here is yet another term used in the article already. Transparency in business is crucial for trust to exist between the service provider and the customer. It is the nature of human beings to know what is happening with something they are involved with, which is why nobody likes secrets, hidden rules and misuse of information and data, and constant mistreatment by the higher power. When there is nothing to hide, it is easy to do business, and this is exactly what the fully transparent nature of blockchain allows. Anyone can review every single transaction of cryptocurrency and make decisions on it. Similar to the last benefit discussed, it is something that makes those who want to mistreat others within this system think twice.
Last but not least, we have the issue of security, or lack thereof really. With blockchain transaction records you should not worry about losing any funds because every single transfer is done through a network of computers meaning no single place of failure can exist. Hackers and infiltrators have an extremely tough job to do if they wish to stop the transaction or sway it their way. Increased cybersecurity and all the new technologies introduced in the last 10+ years further cemented blockchain and virtual currencies as the most secure way to do business in the modern world.